NBA 2016/17 Dead Money: Southwest Division

The concept of “dead money” on a salary cap isn’t as common in the NBA as it is in the NFL, but it essentially functions the same way in both leagues. Dead money refers to the salary remaining on a team’s cap for players that are no longer on the roster.

For NFL teams, taking on a certain amount of dead money is a common practice, since signing bonuses affect cap hits differently, and big-money players are more likely to be released before playing out their entire contracts. That practice is less common in the NBA.

Still, with the NBA’s salary cap on the rise, teams may be a little more willing to part ways with players on guaranteed salaries, since that increased cap gives clubs more flexibility than they used to have. Within the last month, we’ve seen players like Ronnie Price and Greivis Vasquez, who each had $4-5MM in guaranteed money left on their contracts, waived in order to clear room for newcomers.

We’re in the process of examining each of the NBA’s 30 teams, breaking them down by division. We’ll determine which teams are carrying the most dead money on the cap for 2016/17, and what that information might tell us about those teams. We’ve already examined the Central, Atlantic, and Southeast divisions. Today, we’ll turn our attention to the Western Conference and check in on the Southwest division.

A higher dead-money total doesn’t necessarily mean a team managed its cap poorly, but it’s still a little surprising to see the Spurs atop the Southwest list, given what a tight ship the team runs. Some of these charges were essentially out of San Antonio’s control. For instance, Tim Duncan is counting for $1.881MM on the 2016/17 books, since the club wasn’t about to fight to recoup his salary after he decided to retire.

However, Livio Jean-Charles‘ $1.189MM dead-money hit is a curious one. The team signed him to a four-year rookie contract earlier this year, and the first two years were guaranteed, so he’ll count against the Spurs’ cap again in 2017/18. It’s extremely rare for a first-round pick to be waived so soon after he signed his rookie deal.

In order to keep Lance Stephenson on their roster to start the season, the Pelicans had to waive a guaranteed salary, which meant parting ways with Alonzo Gee ($1.4MM). Given his place on the roster bubble, it was somewhat odd that New Orleans gave Gee a fully guaranteed contract to begin with — not to mention they cost themselves some extra money by not doing a minimum salary deal, as I’ve outlined before.

Still, while that decision could be questioned, it’s hard to criticize the Pelicans for the rest of their dead money. Stephenson suffered a groin injury and needed to be waived to clear room to add backcourt depth. His salary was only initially guaranteed for $100K, but New Orleans remains on the hook for the full $980K cap hit until Stephenson recovers from the procedure on his groin. He should return early in the new year, at which point the Pelicans’ dead-money total will decrease.

Like the Spurs and Pelicans, the Rockets signed a player this summer to a guaranteed deal, then waived him. Houston actually did it twice, with Pablo Prigioni ($1.051MM) and Gary Payton II ($543K), opting to keep Bobby Brown and Kyle Wiltjer on the roster instead. Still, the Rockets wouldn’t have gained any meaningful cap room by cutting their non-guaranteed players instead of Prigioni and Payton, so the moves didn’t impact their flexibility — they just cost ownership a little extra money.

The majority of the Grizzlies’ dead money for 2016/17 comes as a result of waiving former first-round pick Jordan Adams ($1.22MM). In retrospect, the team likely regrets picking up its 2016/17 option on Adams last year, since his contract would have expired in the summer in that scenario, leaving no extra money on the ’16/17 cap. It may not come back to haunt the Grizzlies, but the club is currently less than $3MM away from the luxury tax line, limiting the team’s ability to add much salary throughout the season via signings or trades.

The Mavericks, like the Grizzlies, are less than $3MM away from the tax threshold, so even though their dead-money charges aren’t significant, every little bit counts. Among the former Mavs counting against the cap this year? Jonathan Gibson ($543K), Maurice Ndour ($437K), and Gal Mekel ($316K).

Sometimes, teams needing to clear salary from their books can convince a team to take on a modestly-paid player by throwing in cash in the deal, but the Mavericks won’t be able to do that during the 2016/17 season — they’ve already used that move. In order to clear cap room this summer to accommodate Harrison Barnes and their other additions, Dallas sent Jeremy Evans and his $1.227MM salary to Indiana along with $3.227MM in cash. Teams can only send up to $3.5MM out in trades during the ’16/17 league year, so if the Mavs need to clear salary at some point, they’ll need to take another approach.